Columbus, Ohio's leadership under mayor Mike B. Coleman
Posted in the Columbus Forum
#1 Jan 28, 2013
City's flush — time to roll back tax hike?
By Lucas Sullivan
Story posted 01.28.2013 at 08:23 AM EST
While many cities across Ohio and the nation struggle to deliver vital public services within budget, Columbus has become co-owner of a hockey arena, is offering substantial loans to small businesses and plans to increase its savings account to $75 million.
The financial success after a brutal recession is earning Columbus the nationwide reputation as a vibrant, growing, Midwestern oasis where economic times are good again. But does the city government have too much money and should it consider an income-tax rollback?
Columbus' rapid comeback has a lot to do with good timing by its government. Mayor Michael B. Coleman and the city council persuaded voters to increase the income tax from 2 percent to 2.5 percent in 2009. The increase pumped about $100 million more into the city's general fund each of the past three years and allowed Columbus to sidestep steep state cuts and the recession.
That revenue is $58 million more than Auditor Hugh J. Dorrian projected the city would bring in from 2010 to 2012. The extra money has allowed the city to pour money into its rainy-day fund. Officials are planning an additional $13 million deposit this year that will increase the city's reserves to $53 million. Coleman wants to beef up reserves to $75 million by 2018.
He and Dorrian, along with many others at City Hall, balk at the idea of a tax rollback. But other elected and finance officials quietly concede it's a legitimate question once the rainy-day fund hits $75 million.
"I have been clear on this issue that I cannot predict the future, and so I can't comment on what we might do in the future," Dorrian said. "But remember, operational costs are going to continue to rise, and we as a city went through $91 million in reserves (from 2003 to 2009), and there will likely be another financial crisis at some point in the future."
Most financial experts, including Dorrian, recommend that cities have 8 to 12 percent of their total annual budget in savings in case of emergency.
The $53 million rainy-day fund the city anticipates by the end of this year represents about 7 percent of its $773 million general-fund budget.
"It's important for many reasons, including our credit rating, that we have that 8 to 15 percent savings because there is no predicting the future," said Councilwoman Priscilla Tyson, who also is chairwoman of the city's finance committee. "I can't say I would be in support of a rollback because no one knows what the future holds, and I think people are happy with the quality of life here."
Income-tax revenue accounted for $536.5 million of the city's $738.5 million budget last year. The city would have generated $482.8 million if the income tax had been just 2.25 percent. That difference pretty much cancels out the city's $53 million rainy-day fund.
Some small-business owners say a rollback would help them, but they also agree that the city has made great progress, and they approve of its direction.
"Anything that helps lower the cost of doing business would help for small-business owners," said James Mason, owner of the Book Suite, 887 E. Long St. "I am working more hours in the last three years because I have less people working for me, but there is the fact I love being in Columbus, and I am proud of the city that we are ahead economically compared to other places."
Greg Lawson, a Republican candidate for city council, said the city could attract more jobs and help businesses grow if the tax were rolled back to 2.25 percent.
"The rainy-day fund is an important thing to have and that is a wise investment, but in order to be more competitive with the rest of the region, we have to consider the rollback," Lawson said. "Lower taxes are better, and the state realizes this helps small businesses, and people need to remember that it's their money, not the city
#2 Jan 28, 2013
Columbus Mayor Michael B. Coleman (D) has bought the mayorship for as long as he cares to hold it and paid for it with suburbanite tax dollars. The GOP cannot compete against "Hiz Honor". The helicopter repairman was proof of that.
#3 Jan 28, 2013
Did you not read the article? Columbus is in the 'black' as far as our coffers. It's not the Mayor who demands taxes be paid to the city if the 'suburbanites', of their own free will, choose to commute to Columbus in order to pay their mortgage. You chose to live in the 'burbs' then work there also! Problem solved. My cousin works in a Columbus plastics plant. But in the lot outside there's Pickaway, Madison, Union, and Ross counties on the car plates.
No wonder there's high unemployment in the urban cities! Cut the welfare and encourage urban businesses to hire and job training the blacks, you'd solve two issues in one deal.
#4 Jan 28, 2013
C'mon wiggers. You stingy people don't realize that the goonion trash will strike for just the exact amount of that surplus. You wait...city budget director will say $X surplus and Trumpke the Pig will be sh^tting on the steps of city hall for just that exact amount.
#5 Jan 28, 2013
I am saying Columbus Mayor Michael B. Coleman (D) recognized a golden opportunity and is making the most of it. Programs benefiting Columbus citizens paid for by suburban tax dollars. It's the very best of "taxation without representation". The Republicans talk of cutting the 2.5% city income tax and that won't fly with Columbus voters. Mike Coleman has it figured out.
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